Federal Graduate PLUS Loan

Beginning July 1, 2006, graduate/professional students will now be able to borrow from the federal PLUS loan program. The federal PLUS loan program has been expanded to allow graduate/professional students to borrow additional federal loan funds under their own signature and will be called the Graduate PLUS Loan.

A student must complete the Free Application for Federal Student Aid (FAFSA) for the intended academic year as part of the eligibility process for the Graduate PLUS loan. Students must also apply for their annual loan maximum eligibility under the Federal Direct Unsubsidized loan program before applying for the Graduate PLUS loan.

The Graduate PLUS loan can be used to help bridge the gap between the financial aid package and the remaining cost of education. A student enrolled at least half-time may borrow up to the cost of attendance minus other aid. The Graduate PLUS loan is unsubsidized with a fixed interest rate of 6.41% for the 2013 – 2014 academic year and a 4.204% origination fee, as set by the Department of Education. Future rate will vary.

A credit check will be performed by the lender at the time of application to determine eligibility for the GRAD PLUS Loan. The borrower must not have adverse credit history via a credit check.

Repayment begins within 60 days of final disbursement of the Graduate PLUS loan. However, the borrower may receive deferment while s/he is enrolled at least half-time at an eligible school. Upon dropping to less than half-time, the borrower is not entitled to a grace period. Various deferment and forbearance options are available if the student has difficulty repaying the loan but interest will continue to accrue. Standard repayment period is 10 years with flexible repayment options, such as the Standard, Extended or Graduated repayment plan. The Graduate PLUS loan would qualify for the Federal Consolidation Loan as well.